Alphabet CEO Sundar Pichai is issuing a dire warning, saying that there will be nowhere to hide for AI companies if the massive investment boom takes a wrong turn.
In a recent BBC interview, Pichai traces the current era to previous inflection points in technology, including personal computing, the internet, mobile, cloud and now AI.
He also says the race is now at a critical juncture as firms collectively pour 13 figures into the AI infrastructure buildout.
“Google was spending less than $30 billion per year. This year, that number is going to be over $90 billion. And if you collectively add what all the companies are doing, we have well over a trillion dollars of investment going in, in building the infrastructure for this moment.”
Pichai admits that even though the buildout is grounded in real demand, history teaches extra caution.
“You see real demand, and we are constrained in our ability to serve that demand. So, given the potential of this technology, the excitement is very rational. It’s also true when we go through these investment cycles, there are many we overshoot, right, collectively as an industry. We can look back at the internet right now. There was clearly a lot of excess investment, but none of us would question whether the internet was profound or did it drive a lot of impact.”
He believes that the AI investment cycle will not be different from the dot-com boom, as he expects firms and investors to make mistakes that could trigger a forest-clearing moment.
“I expect AI to be the same. So I think it’s both rational and there are elements of irrationality through a moment like this. No company is going to be immune, including us. If you overinvest, we’ll have to work through that phase.”
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